The principle of general average gives a ship's captain an incentive to consider the value of cargo when jettisoning it to prevent a disaster.

Question

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The principle of general average stipulates that all parties involved in a maritime adventure share the losses resulting from a sacrifice made to save the entire venture. This means that if the captain decides to jettison some cargo to prevent the ship from sinking, the parties that benefit from the sacrifice, including the cargo owners, are required to contribute to compensate for the loss. Therefore, the captain has an incentive to consider the value of the cargo before jettisoning it, as this can impact the distribution of the costs of the sacrifice among the parties.

The Principle of General Average Gives a Ship's Captain an Incentive